HB50 Alabama 2015 1st Special Session

Summary

Primary Sponsor

Mac McCutcheon

Republican

Session

First Special Session 2015

Title

Taxation, levy of index gasoline tax and index diesel tax, authorized, Secs. 40-17-370 to 40-17-373, inclusive, added; Sec. 40-17-325 am'd.

Summary

HB50 would create an index-based gasoline and diesel tax in Alabama to fund infrastructure, starting with a five-cent per gallon index and potential additional two-cent yearly increases based on fuel prices, and would adjust the base motor fuel tax rates accordingly.

What This Bill Does

It establishes the Alabama Infrastructure Responsibility Act (Article 13) to index the gasoline and diesel taxes, starting with a five-cent per gallon base and an additional two-cent annual indexing if price criteria are met. It defines base prices for gasoline ($3.09/gal) and diesel ($3.47/gal), uses CPI and current-year fuel prices to determine adjustments, and caps total increases to 15% of the current price; calculations are posted each May and take effect Sept 1. It modifies the motor fuel tax rates (gasoline and diesel) to incorporate these index taxes and specifies how proceeds are collected and allocated after covering collection costs. It also sets effective dates for the indexing provisions (Sept 1, 2015) and the base-rate changes (Oct 1, 2016), and repeals conflicting laws to align with the new structure.

Who It Affects

• Consumers of gasoline and diesel in Alabama, who would face higher pump prices due to the new index tax and potential annual adjustments tied to fuel prices.
• The Department of Revenue and fuel retailers/sellers, who would calculate, publish, and collect the new index taxes and implement the updated tax rates.

Key Provisions

• Creates the Alabama Infrastructure Responsibility Act, indexing five cents per net gallon of gasoline and diesel, with an additional two-cent annual index if price criteria are met, based on CPI and current-year fuel prices.
• Defines base prices (gasoline $3.09/gal, diesel $3.47/gal) and numerous related terms (current-year prices, net index proceeds, cost of collection) to govern the indexing mechanism.
• Requires annual calculations by March 31, posting results by May 31, and implementing changes effective September 1; caps annual increases at 15% of the current-year price.
• Amends Section 40-17-325 to set base motor fuel taxes at 18 cents per gallon for gasoline and 19 cents per gallon for diesel, plus any index taxes from Article 13; specifies how proceeds are used after covering collection costs and allocated under existing distribution rules.
• Proceeds of the index taxes are allocated after costs of collection, with defined distribution shares to various state accounts and programs.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation